The sprawling greater-Denver metro region is in news-media crisis. In the information age, when there seems to be more and more to know, there is less and less being reported by the diminishing number of local mainstream news outlets here. So it comes as little surprise that media watchdog organization FreePress this week is highlighting the Denver news market as a negative example for the nation. The organization reports that, on top of shrinking newspaper reporting, the local TV news market is host to a “severe” form of the kind of sly consolidation that media corporations have been effecting across the country for nearly a decade. FreePress says this “covert consolidation,” where direct ownership is never transferred, is gaining momentum and that it skirts federal ownership laws and erodes market variety and competition.

Over the last two years, Denver news stations Fox 31 KDVR and CW 2 KWGN have entered a “shared services” agreement through which station operations are merged. The stations share broadcast scripts and reporting, for example, the same way they share staffers, equipment, management personnel and studio and office space.

“Just because the name on the letterhead hasn’t changed, doesn’t mean that the spirit of media ownership laws hasn’t been violated,” FreePress Program Director Josh Stearns told the Colorado Independent. He said the owners of the stations are squatting on public airwave space that could be taken up by another company or organization, which would hire its own writers, reporters and producers to deliver an original and rival product to KDVR and the other stations in the market. Stearns believes the KDVR-KWGN agreement effectively tramples regulations meant to guard against media “duopolies,” where a single company owns two or more stations that serve the same community.

‘We haven’t violated anything’

KDVR/KWGN President and General Manager Peter Maroney has heard these arguments before.

“Listen, that’s one side of the issue. We haven’t violated anything,” Maroney told the Colorado Independent last Thursday. He said he had yet to see the FreePress campaign but he signaled that he thought this debate had long ago been settled.

“The [shared services] agreement doesn’t violate or even challenge the ownership laws. There’s nothing new about local sales and marketing agreements. They have all passed the test with the [Federal Communications] Commission. We’re well within the regulations.”

KDVR is owned by Kentucky-based company LocalTV. KWGN is owned by the Chicago-based Tribune Co.

Maroney said the stations were not squatting on airwave space. He said he was running one organization that was producing two different products.

“Every program on each of the stations has its own decision-makers. There are different line producers, different presenters. What the stations do is produce the news of the day. That hasn’t changed.”

‘Photocopy news’

For the uninitiated, exploring Maroney’s products can be disorienting, at least at first blush.

Call the basic operating number at KDVR and KWGN– it’s the same number– and ask to talk to the management of each of the stations. You get a searching response.

“Well, you see, all of our operations have merged,” staffer Jim Yoshinaga told the Colorado Independent. “We have one news team. One news director. All of our operations are merged by agreement.” If you speak to the manager of one station, he said, then you’ve spoken to the manager of both stations.

“Jeremy Hubbard has returned home to Colorado as anchor of FOX31 News Nightside,” reads the KWGN site. “Dave Fraser is the Associated Press award- winning chief meteorologist of KDVR.”

Of course the stations benefit by pooling resources, FreePress Program Coordinator Libby Reinish said, but the public pays the price. There’s less information and the information the public receives is the same kind of information and reported in this case by the same people with the same backgrounds and biases.

Reinish describes KDVR and KWGN as local news through a funhouse mirror: the same but different. These aren’t broadcasts, she said, as much as “simulcasts.” “They’re not rival products at all.”

“The Denver example is really striking,” she adds, pointing to a video FreePress is distributing on the Web as a part of the new public-awareness campaign. “You have two ostensibly different newscasts, two different stations, but the anchors are reading the same script.”

In the video, hosts from KDVR and KWGN introduce segments on an effort to deal with dog waste in city parks. They finish their introductions with verbatim phrasing. Then each of the hosts introduce the same reporter, Greg Nieto, who delivers the exact same report for viewers watching the different stations.

“OK, so there’s a different presenter on one of the stations. That’s just a way to maintain some discreet cover. You keep a few different faces but the staff and the material increasingly overlap.”

Reinish said resource sharing starts out as a sensible business decision but that the sharing tends to creep.

“Of course it makes sense to send one crew instead of two to an event. They say they’ll be freeing up staff to do more in-depth reporting on other stories, but that almost never happens. They lay off people instead.”

In making these deals, Renish says TV executives are trading on the widespread impression that news-industry profits are tanking.

“They cry poor,” she said, “but that’s not how it is for TV news. It’s nothing like the newspaper industry.”

Local news bottom lines

FreePress cites a recent FCC report that chronicles the rise in profits at local TV news stations (scroll to Chapter 3 of the report on local TV). Fact is, local TV news remains the greatest source of news among the public. Nearly 80 percent of Americans get their news from local TV stations.

Although profits dipped for years as cable TV rose, 2010 saw profits rise at local news stations, even as newspapers folded around the country gushing red from the bottoms of their balance sheets.

For the first three quarters of the year, profits rose a whopping 27 percent at local TV stations, and the news sector brought in a lion’s share of those profits. After the Supreme Court’s 2010 Citizens United ruling lifted restrictions on political spending, local news ad buys have grown enormously and are growing still.

[T]he high percentage of income derived from news—44.7 percent in 2009—is “increasingly significant when considering the average television station that produces news airs an average of just 4 hours and 36 minutes of news per weekday.

Borrell Associates, a consulting firm that focuses on local media and advertising, estimates that the court ruling generated additional political advertising totaling $400 million in the 2010 elections. This created a windfall for local TV stations: in 2010, political advertisers spent an estimated $2 billion to $3 billion on local TV stations, which may be as much as 100 percent more than in 2008— despite the fact that 2008 was a presidential election year and 2010 was not.

Pew reports that the trend is alarming not least because it throws off balance for viewers. Political stories take up mere minutes of each news broadcast while political advertisers bombard viewers with their messages during breaks in the news shows and beyond.

Working off of data compiled by Pew and the FCC, FreePress reports that in states with competitive Senate races last year, four times as many hours were given to advertisements than to coverage of the races.

The 2010 Colorado U.S. Senate race between Michael Bennet and Ken Buck was the closest in the nation. Yet the organization reports that an estimated 88 percent of half-hour news shows in Denver contained no stories about the Senate race.

As the FCC notes, the windfall local TV news profits have also failed to save many journalism jobs. On the contrary, more local TV news is being produced by less reporters and editors. Nearly 65 percent of local TV news stations have cut staff and budgets over the last few years, although station directors are reportedly optimistic that they can add staff this year.

The drying Denver news landscape

Since 2009, when the Rocky Mountain News shuttered, the Denver Post has enjoyed a monopoly in the daily newspaper market here. The small Denver Daily News recently followed the Rocky into history and the weekly Westword survives mostly due to the herculean efforts of its skeleton staff and a wave of generous new medical marijuana advertisers.

For perspective: There are roughly 1.6 million households in the region and the entire front section of the Denver Post most days serves up a mere three or four news stories written by Post reporters about Colorado. Wire service stories make up at least 75 percent of the Denver Post front-section bylines. The Post places New York Times stories in the precious front-page space above the fold. There is no other general interest daily paper and the struggling Post recently cut an additional 4 percent of its budget.

The Rocky Mountain News was the longest-running newspaper serving the region, and its demise made national news. Yet just a few months before the Rocky closed, as FreePress points out, Denver also lost its longest-running locally produced newscast. When KDVR merged through the shared services agreement with KWGN, 30 staffers were sent packing.

Stearns said federal media ownership laws are shaped by local patchworks of regulations, which can be more and less strict depending on a lot of factors, like the size of the market. He said the FCC is presently reviewing its media ownership rules and so the FreePress campaign is designed to shed light on the ways TV news is both expanding and dwindling simultaneously, delivering more of less news.

Twenty percent of commercial TV stations broadcast no local news, Stearns points out in a release, and of those that do, according to the FCC, “nearly one-third say they are running news produced by another station.” In its own reporting FreePress claims to have identified nearly 80 markets where some version of a “shared service” deal is in place, involving more than 200 stations.

Yet, with newspapers struggling, local TV news bears an increased burden in informing the public. Now is the time to act, Stearns said.